Key event definitions

Gain a better understanding of global macroeconomic events, find out why these data releases are significant and how they can impact market prices.

ADP national employment report

This is one of the most closely watched indicators of employment in the US
after
the non-farm payrolls and is highly regarded as a comprehensive measure of job creation in the country. An
increase in this figure indicates rising employment and potential inflation pressures, which can lead to
rate
increases.​

Released monthly, about two days after the month ends.

Measures the estimated monthly change in employment in the US, excluding the
farming and government sectors.

Business inventories

Business inventories often reflect turning points in the state of the economy.
Low
inventories can mean the economy is about to flourish because businesses' stock rooms are empty and need to
be
replenished, in turn requiring higher production. High inventories combined with low sales indicate a
slowing
economy as wholesale orders lessen, slowing production.

Released monthly.

Measures the change in the value of unsold goods held by manufacturers,
wholesalers and retailers.

Construction spending

Shows the change in a country's residential and non-residential construction
spending. An indication of the level of construction activity in the country.

The construction industry makes a large contribution to GDP, in terms of
investment and stimulus of associated industries. In the US, the impact of this report is muted as it is
released after the building permits and building starts figures, which provide similar information.

Released monthly.

Measures the change in the total amount spent on construction projects in the
US.

Consumer credit

This report corresponds with a country's consumer confidence and spending. An
increasing consumer credit figure indicates that lenders are feeling more comfortable with issuing loans,
and
consumers are more confident in their financial positions and are therefore more eager to spend money.

Released monthly.

Measures the change in the total value of outstanding consumer credit that
requires instalment payments.

Consumer price index (CPI)

The main measure of inflation in a country. Often used by central banks when
deciding where to set the country's official interest rate.

Released monthly, about 15 days after the month ends.

Measures changes in the cost of living. Calculated by tracking changes in the
price of a basket of goods and services used by a typical household.

Current account

A positive value means that the flow of capital in a country exceeds the
capital
leaving the country. A negative value reflects a current account deficit, where there is a flow of capital
out
of the country. Ongoing current account deficits can lead to a weakening of the country's currency.

Released quarterly, about 75 days after the quarter ends.

Measures the flow of goods, services, transfer payments and income into and
out of
a country.

Empire State survey (New York Federal
Reserve)

A leading indicator of overall economic health in the state of New York and
manufacturing in the US based on a survey of about 200 manufacturers in New York. Businesses react quickly
to
market conditions and this figure describes the prevalent sentiment among manufacturing businesses in New
York.
A figure of above 0 indicates improving economic conditions, whereas a figure below 0 signals worsening
conditions.

Released monthly, around the middle of the current month.

Measures the level of a diffusion index that gauges business conditions and
expectations of manufacturing executives in the state of New York.

Existing home sales

The existing home sales release is a good indication of the health of a
country's
housing market. Sellers of existing homes often spend part of the profits they make on consumption, which
has a
positive effect on the economy. There are other ripple effects that boost the economy too, such as
renovations
on homes and new business for banks issuing mortgages.

Released monthly.

Measures the number of homes that are under contract to be sold but are still
awaiting the closing transaction. This figure excludes new construction.

Factory orders | durable goods orders

A good measure of the level of demand for goods in a country. More orders
demand
more production and this boosts activity in the manufacturing sector. The factory orders or durable goods
orders
figure is a reliable indicator of manufacturing activity. On the other hand, when consumers are less
confident
in the economy, durable goods sales are the first to reflect this, as consumers can delay the purchases of
durable items like televisions and cars.

Released monthly.

Measures changes in the value of new orders, unfilled orders, shipments and
inventories reported by US manufacturers. This figure is the revised durable goods figure.

Gross domestic product (GDP)

Gross domestic product, or GDP, is a broad indicator of overall economic
activity
and growth. There are three versions of GDP released about a month apart: advance, preliminary and final.
The
advanced version tends to have the most impact on the market as it is the first to be released, whereas the
final GDP is the change in the value of all final goods and services produced in the country.

Released quarterly, about 60 days after the quarter ends.

Measures the change in the value of all final goods and services produced in a
country.

Import prices

This figure has an impact on inflation for both consumers and businesses that
rely
on imported goods and services. If the import price goes up, costs are passed on to these businesses and
consumers. In the US, this is the earliest inflation data released by the government.

Released monthly.

Measures the change in the prices of goods and services imported in a
country.

ISM manufacturing survey

A leading indicator of overall economic health in the US, because businesses
in
the manufacturing sector react quickly to market fluctuations and their purchasing managers hold the most
up-to-date and relevant insights into a company's views on the economy. Around 400 purchasing managers
are
surveyed – they're asked to rate relative levels of business conditions like employment, prices,
inventories,
production and new orders. A figure above 50 reflects industry expansion; below 50 indicates the
opposite.

Released monthly, on the first business day after the month ends.

Measures the level of a diffusion index that is based on a survey of
purchasing
managers in the US manufacturing sector.

Mortgage application survey |MBA market
index

The MBA mortgage applications survey is a good gauge of the state of the US
housing market. An increasing number of mortgage applications suggest a healthy or thriving housing market,
which has a positive effect on the rest of the economy.

Released weekly.

Measures the demand for mortgages in the US. Also included in this report are
a
variety of indices, including the purchasing index and the refinancing index. The purchasing index measures
the
change in existing home sales in all mortgage applications, while the refinance index measures the mortgage
refinancing activity.

Non-farm payrolls

This release measures the number of jobs added or lost in the US during a
particular month. Agricultural jobs are excluded due to their large seasonal fluctuations. The non-farm
payrolls
are a notable economic indicator, normally released on the first Friday of every month by the US Department
of
Labor. It presents the number of people on the payrolls of all businesses, with the exception of
agricultural,
local government, private household and non-for-profit. The monthly figure can change significantly, and
often
leads to a high level of volatility in FX pairs such as EUR/USD, around the time of the release. Generally,
a
high reading is seen as positive (or bullish) for the US dollar, while a low reading is seen as negative (or
bearish).

Released monthly, usually on the first Friday after the end of the month.

Measures the percentage of the total US workforce that was unemployed but
actively
seeking employment during the previous month.

Personal income

This figure is useful for gauging the spending power of consumers in the US.
Increased income allows for increased consumer spending which fuels the US economy and encourages
growth.

Released monthly.

Measures the change in value of income that consumers in the US receive,
before
tax. Income sources include employment, investments and transfer payments.

Philadelphia Fed business outlook survey

Based on a survey of around 250 manufacturers who are asked to rate the level
of a
number of general business conditions. Higher figures reflect a positive outlook from manufacturers,
suggesting
increased production that leads on to economic growth. A figure above 0 indicates improving conditions,
while a
number below 0 indicates worsening conditions. Although this is a well-established, valued survey, its
impact on
release can be relatively mild because the figure comes out a few days after the highly correlated state
manufacturing index.

Released monthly, around the middle of the current month.

Measures the level of a diffusion index that gauges business conditions and
expectations of manufacturing executives in Philadelphia.

Producer price index (PPI)

Gives an early indication of inflation that consumers will face later, because
this index analyses changes that take place before goods reach the retail level. When producers charge more
for
goods and services, these costs are usually passed on to the consumer. A rise in prices and inflation may
lead
to the US Federal Reserve increasing interest rates. A falling PPI may suggest an economic slowdown.

Released monthly.

Measures the change in the price of goods and services sold by producers in
any
country.

Retail sales

The retail sales figure is an important measure of consumer demand and
spending.
Increased retail sales mean higher retail output and economic growth, as consumer spending makes up a
majority
of the overall economic activity.

Released monthly.

The change in the total value of sales by a country's retailers.

Trade balance

Trade balance is directly linked to demand for the country's currency. A positive trade
balance, also called a surplus, indicates that more goods and services were exported than imported. In the
US,
for instance, foreigners must buy US dollars to buy US goods and services and this strengthens the dollar. A
demand from abroad also boosts production and prices at manufacturers.

Released monthly.

The trade deficit is the amount that imports exceed exports that month.

Unemployment claims

Employment is vital to the economy. If unemployment is up, consumer spending
goes
down and there is less demand for goods and services. Employment is a good indicator of an economy's
health.